£8 compensation from LowCostHolidays?

The collapse of the company have left British holidaymakers in limbo, with many angry at the lack of financial protection, and lack of help from anyone.

The news is getting worse, as it looks like customers could receive as little as £8 (or less) in compensation.

One source of frustration and venom is that LowCostHolidays were taking bookings the day it went into administration, and one customer online has said that they made a booking on Friday morning, the company went bust on Friday day, and the money was taken out of their account on the Sunday.

Customers have learned of the company going under from pretty much every source other than the company themselves.

The only correspondence that customers have had, is an automatic request for feedback on the service they received. You can imagine that people took that opportunity to vent spleen.

As we mentioned previously, some years ago the Civil Aviation Authority (CAA) warned against booking holidays with the company, with regard to the lack of protection offered to people in the UK after LowCostHolidays moved their business to Spain, removing itself from ABTA and ATOL protection schemes.

Administrators Smith & Williamson said they'd put a bond in place for £1.09 million, which works out as a few quid for each customer. They added that they are expecting “very substantial" claims from around 140,000 people, but they warned that payouts are unlikely to be more than 1%-2% per claimant, which is likely to be less than £10.

So what now?

The UK European Consumer Centre (UK ECC) said that those stranded on a holiday, thanks to this collapse, should keep all their receipts for any expenses relating to LowCostHolidays.

Hopefully, you'll be able to make a claim via debit or credit card, or an insurer.

If you're looking to get your money back via the Visa Chargeback scheme, get in touch with your bank.

The UK ECC spokesperson said: "It's good that there is an organisation such as the Spanish regulator for travel agencies. However, consumers are not likely to receive all of their money back via this avenue, as there are limited funds available."

"Consumers will also need to pursue other options as well. However, if they are in any doubt, they should contact the UK European Consumer Centre on 01268 886 690 for advice."